WELCOME 2Q FY2014: Analyst and Media Briefing

Transcription

1 WELCOME 2Q FY2014: Analyst and Media Briefing Magnus Böcker, CEO Chng Lay Chew, CFO 22 January 2014

2 Agenda for Second Quarter FY2014 Results Briefing 1 Second Quarter Highlights 2 Financial Performance 3 Business Update 4 Questions & Answers 2Q FY2014 Results, 22 January

3 Second Quarter FY2014 Highlights Net profit of $75 million, down 2% from a year earlier $165M +2% $76M +6% $88M -2% $75M -2% 7 cents 4 cents Revenue Expenses Operating Profit Continued growth of Derivatives Total equity and commodities derivatives volume up 18% to 26.3 million contracts Month-end open interest increased 45% to 3.6 million contracts Extension of product suite into new asset class with launch of FX futures Decline in Securities turnover mitigated by higher average clearing fees Total traded value of $64.1B and SDAV of $1.0B, down 18% and 19% respectively Average clearing fees increased 6% to 3.2 basis points Meeting the highest regulatory standards Net Profit Earnings per share Both clearinghouses assessed by IMF as compliant with the new PFMI standards Dividend per share First Asian clearinghouse to be authorised by US CFTC as Derivatives Clearing Organisation 2Q FY2014 Results, 22 January

4 Financial Performance Chng Lay Chew CFO

5 Financial Performance: Quarterly Trend Net profit of $75 million, down 2% from a year earlier Revenue +2% year-on-year -11% quarter-on-quarter Expenses +6% year-on-year -1% quarter-on-quarter Operating Profit -2% year-on-year -17% quarter-onquarter Net Profit -2% year-on-year -19% quarter-on-quarter QFY133QFY134QFY131QFY142QFY14 Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

6 Financial Performance: Revenue, Year-on-Year Revenue of $165 million, up 2% from $162 million in 2Q FY SDAV down 19% to $1.0B Average clearing fee up 6% to 3.2 basis points Total traded volumes up 18% Higher income from collateral management +2 Increase in institutional settlement instructions 165 2Q FY2013 Securities Derivatives Market Data & Connectivity Depository Services Issuer Services 2Q FY2014 2Q FY (32%) 52 (32%) 19 (12%) 23 (14%) 17 (10%) $165 million 2Q FY (37%) 45 (28%) 19 (12%) 22 (13%) 16 (10%) $162 million Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

7 Financial Performance: Revenue, Quarter-on-Quarter Revenue of $165 million, down 11% from $184 million in 1Q FY SDAV down 25% to $1.0B Lower volumes of settlement instructions and contracts processed Decrease in number of listings Seasonal dip in dividend processing 165 1Q FY2014 Securities Derivatives Market Data & Connectivity Depository Services Issuer Services 2Q FY2014 2Q FY (32%) 52 (32%) 19 (12%) 23 (14%) 17 (10%) $165 million 1Q FY (38%) 52 (28%) 19 (10%) 25 (14%) 19 (10%) $184 million Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

8 Financial Performance: Expenses, Year-on-Year Expenses of $76 million, up 6% from $72 million in 2Q FY Higher depreciation from new risk management system 76 2Q FY2013 Staff Technology Processing & Royalties Premises Professional Fees Others 2Q FY2014 2Q FY (39%) 26 (35%) 7 (9%) 5 (6%) 3 (4%) 6 (7%) $76 million 2Q FY (41%) 25 (35%) 6 (8%) 4 (6%) 2 (3%) 5 (6%) $72 million Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

9 Financial Performance: Expenses, Quarter-on-Quarter Expenses of $76 million, down 1% from $77 million in 1Q FY Lower variable bonus Higher depreciation from new risk management system Q FY2014 Staff Technology Processing & Royalties Premises Professional Fees Others 2Q FY2014 2Q FY (39%) 26 (35%) 7 (9%) 5 (6%) 3 (4%) 6 (7%) $76 million 1Q FY (42%) 25 (32%) 7 (10%) 5 (6%) 3 (4%) 5 (7%) $77 million Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

10 Financial Performance: Key Indicators 2Q FY2013 3Q FY2013 4Q FY2013 1Q FY2014 2Q FY2014 Revenue ($ million) Operating Profit ($ million) Operating Profit Margin 56% 61% 60% 58% 54% Return on Equity 39% 40% 39% 48% 46% Earnings per share (cents) Dividend per share (cents) Operating Cashflow (cents per share) Earnings per share (cents) Dividend per share (cents) Note: All figures in $ millions unless otherwise stated and may be subject to rounding 2Q FY2014 Results, 22 January

11 Business Update Magnus Böcker CEO

12 Highlights for the Quarter Derivatives growth offsets dip in Securities market Continuing growth of Derivatives; expansion of product suite into FX Lower Securities traded value mitigated by higher average clearing fees Meeting the new international regulatory standards Securities Derivatives Market Data and Connectivity Depository Services Issuer Services Regulatory and Risk Management Revenue down 13% to $52 million 18% decline in total traded value mitigated by 6% increase in average clearing fees Revenue up 16% to $52 million on continuing growth Month-end open interest up 45% from same quarter a year earlier Revenue up 3% to $19 million driven by growth of co-location business Launched new suite of Singapore dollar bond indices Revenue up 7% to $23 million on increased institutional settlement instructions Revenue up 6% to $17 million following revised listing fees 9 new listings raising $1.4 billion and 144 new bond listings raising $34 billion Both clearinghouses assessed to be compliant with the new PFMI standards Recognised as DCO by US CFTC Announced establishment of Direct Listings Framework with China CSRC 2Q FY2014 Results, 22 January

13 Highlights for the Quarter Derivatives growth offsets dip in Securities market Continuing growth of Derivatives; expansion of product suite into FX Lower Securities traded value mitigated by higher average clearing fees Meeting the new international regulatory standards Securities Derivatives Market Data and Connectivity Depository Services Issuer Services Revenue down 13% to $52.2 million Total traded value and averaged daily traded value down 18% and 19% to $64.1 billion and $1.0 billion respectively Decrease in total turnover partially offset by 6% increase in average clearing fees to 3.2 basis points Upcoming improvements to securities market microstructure 77.8 Total Securities Value Traded ($ billion) Securities Average Clearing Fee (basis points) Regulatory and Risk Management 2Q FY2014 Results, 22 January

14 Highlights for the Quarter Derivatives growth offsets dip in Securities market Continuing growth of Derivatives; expansion of product suite into FX Lower Securities traded value mitigated by higher average clearing fees Meeting the new international regulatory standards Securities Derivatives Market Data and Connectivity Depository Services Issuer Services Revenue up 16% to $52.5 million on growth across key contracts Total traded contracts grew 18% to 26.3 million contracts Month-end open interest up 45% from same quarter a year earlier Continuing growth in commodities Extended product suite into new asset class with launch of 6 FX futures contracts Launched 3 new Asian equity index futures contracts Total Equities and Commodities Derivatives Volumes (million contracts) Average Month-end Open Interest (million contracts) Regulatory and Risk Management 2Q FY2014 Results, 22 January

15 Highlights for the Quarter Derivatives growth offsets dip in Securities market Continuing growth of Derivatives; expansion of product suite into FX Lower Securities traded value mitigated by higher average clearing fees Meeting the new international regulatory standards Securities Derivatives Market Data and Connectivity Depository Services Issuer Services Regulatory and Risk Management Revenue down 13% to $52 million 18% decline in total turnover mitigated by 6% increase in average clearing fees Revenue up 16% to $52 million on continuing growth Month-end open interest up 45% from same quarter a year earlier Revenue up 3% to $19 million driven by growth of co-location business Launched new suite of Singapore dollar bond indices Revenue up 7% to $23 million on increased institutional settlement instructions Revenue up 6% to $17 million following revised listing fees 9 new listings raising $1.4 billion and 144 new bond listings raising $34 billion Both clearinghouses assessed to be compliant with new PFMI standards Recognised as DCO by US CFTC Announced establishment of Direct Listings Framework with China CSRC 2Q FY2014 Results, 22 January

16 Highlights for the Quarter Derivatives growth offsets dip in Securities market Continuing growth of Derivatives; expansion of product suite into FX Lower Securities traded value mitigated by higher average clearing fees Meeting the new international regulatory standards Securities Derivatives Market Data and Connectivity Depository Services Issuer Services Regulatory and Risk Management Assessed to be compliant with the new PFMI standards Clearing and settlement infrastructure assessed under the International Monetary Fund s Financial Sector Assessment Program Assessed to have high levels of compliance with the new Principles for Financial Market Infrastructure (PFMI) standards Confirmed SGX s adherence to the more demanding requirements of the PFMI Recognised as DCO by US CFTC The first clearing house in Asia authorised as a Derivatives Clearing Organisation by the US derivatives regulator, the Commodities Futures Trading Commission New and existing US customers are now able to clear their derivatives contracts through SGX in compliance with the latest US laws and regulations Announced establishment of Direct Listings Framework with CSRC 2Q FY2014 Results, 22 January

17 Outlook Staying the course amid moderate global economic recovery Continuing investments in support of growth strategy FY2014 operating expenses expected to be between $320 million and $330 million; technology-related capital expenditure expected to be between $35 million and $40 million, as previously announced Moving to new premises to cater for operational resilience, better efficiency and enhanced customer service 2Q FY2014 Results, 22 January

18 The journey continues Questions & Answers 17